The consumption function will shift upward if real asset and money holdings:
a. increase, if people expect prices to increase, if interest rates decrease, and if taxes decrease.
b. increase, if people expect prices to increase, if interest rates increase, and if taxes increase.
c. increase, if people expect prices to increase, if interest rates increase, and if taxes decrease.
d. decrease, if people expect prices to decrease, if interest rates decrease, and if taxes decrease.
e. decrease, if people expect prices to increase, if interest rates increase, and if taxes decrease.
QUESTION 2The federal income tax is progressive because poor people pay little or no taxes.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 3A tariff is a tax on ____ goods that is designed to ____.
a. exported; protect domestic industries
b. exported; hurt foreign industries
c. imported; made domestic consumers pay more
d. imported; protect domestic industries
e. domestic; discourage imports
QUESTION 4Economists refer to the simple relationship between consumption and disposable income as:
a. autonomous consumption.
b. the marginal propensity to consume.
c. the absolute disposable income hypothesis.
d. disposable income.
e. the consumption function.
QUESTION 5A person who is in the 15 percent marginal tax bracket and has a total taxable income of 100,000 will owe 15,000 in taxes.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 6A tariff has the effect of granting ____ a larger share of the domestic market.
a. domestic consumers
b. foreign consumers
c. domestic producers
d. foreign producers
e. no producers or consumers
Quick Reply
